It is always the case that money can be found for defence spending, war and any other act of destruction for humankind. As the FT noted yesterday:
The EU plans to temporarily ease its fiscal rules to allow countries to spend more on defence, as the bloc has come under pressure from the US to invest more in its own security.
“I can announce that I will propose to activate the escape clause for defence investments,” European Commission president Ursula von der Leyen said at the Munich Security Conference on Friday. “This will allow member states to substantially increase their defence expenditure. Of course, we will do this in a controlled and conditional way,” she added.
Could the EU permit increased spending to relieve poverty? No. Apparently, that was impossible.
Could it fund the funds to tackle climate change, which is the biggest threat we all face? No. Again, that was not allowed.
But can we relax spending rules for defence? Apparently, that's no problem.
I put it on record: money creation is always a political choice, and as a matter of fact, modern monetary theory precisely describes the process involved.
As US President Eisenhower said in 1961 when leaving the White House:
In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex. The potential for the disastrous rise of misplaced power exists and will persist.
Wise words. We need to tread with care right now.
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Russia spends more on defence/armaments than all of Europe put together. It has made it abundantly clear what intends to do with it. That should be obvious.
Now is not the time to be complaining about a European ‘military industrial complex’ . Unless one is a dyed in the wool, Corbynista, Stop the War apologist for decades of murderous Russian imperialism, that continues today.
Even George Monbiot can now see it.
I am suggesting that any such complex needs to be carefully controlled.
I am not saying we may not need it. I am sayinmg strong political leadership is requican go out of control, as Eisenhower feared.
That’s odd, figures from 2023 would suggest otherwise. Russia 130 US$ vs Europe well over 265 US$.
Good grief, straight from the “the Mails” cliche store.
That’s not true. EU countries (so without GB, Switzerland and Norway) – which are all big military spenders) spend more on defence than Russia. However – with dozens of armies loads is duplicated, procurement’s far from perfect, systems won’t be compatible etc etc (despite most of Europe being in NATO as well).
But – while Trumpist calls for Europe to spend more are mostly done with US military industrial complex in mind, they might end up disappointed. More money and more cooperation will inevitably mean a bigger European military industrial complex and more competition to the US even outside of Europe.
Just to point out Mr Stafford it was the same Corbyn who over two decades ago counselled against being chummy with Putin, as a despot who should not be encouraged. Blair onwards ignored that. I’m not a ‘Corbynista’ BTW, a term used by the lazy minded IMO.
@Robin Stafford
Talk about completely missing the point!
Correct me if I’m wrong Richard, but the point was not about needing or not needing to increase defence spending. The point was that it is well understood that money creation/deficit spending is a matter of political choice. We can increase defence spending should we choose. At the same time we could also if we wished and the resources were available create the money to build the schools and hospitals that we need; employ the doctor/nurses/tsocial care workers and teachers that we need; and employ the builders to build the housing that we need.
It is a political choice that we do not do so.
That was my point, yes.
Robin
The war effort of World War Two and Britain’s ability to create its own sovereign money – an ability that has led out little country to punch above its weight for so long – is what Richard is getting at.
We saw that we could pay for war ( we went to America for arms because of capacity issues – not necessarily because of money issues) in a number of theatres around the world.
Attlee’s post war government declared war on domestic problems , such as poverty, lack of work, poor education and health. That was a choice that could be made today, so I support Richard’s assertion.
War is extremely wasteful; it holds back development and trade, sucks up and destroys resources. Imagine a Europe free of two world wars? It makes me cry thinking about it – the Europe that could have been?
The reason why Russia is as it is because of two world wars. Isn’t it about time we grew up?
My view is that this blasted country could afford to do both. Now we’ll be told that there is even less to look after people at home. Think about the consequences of that, will you?
I agree.
The EU & UK – is circa 500 MILLION people (Russia 160m?) . It is economically the largest trading block on the planet. We (UK & EU) should not have a problem delivering on poverty, climate disaster AND defence. It should be trivial provided we act collectively.
Furthermore, the ECB is on record as saying (Draghi 2015) that is has sufficient resources for any emergency (hmm – the head of a central bank – stating the bleedin obvious) – & what do we hear from the perma-tanned Lagarde – zilch.
War is wasteful – yup. Russia started this one – the EU needs to finish it & make sure that Russia is not in a position to start one again in the short term and – with the right pressure (driving political reform in Russia or – driving a break up of Russia) in the medium long term.
I’m guessing but, the current approach of the USA smacks of “keep the pot bubbling – keep EU – Russia at each others throats – keeps em weak” – well stuff that for a game of monkeys – the USA has been playing that game from 1914 through to the present – time the EU/UK recognised this and took a different tack.
USA out of Europe and the UK.
The US has realised that Ukraine has run out of Ukrainians, and the Wesy has run out of ammo and money to spare ( we have a genocide and ethnic cleansing to attend to ) , the plan to weaken Russia hasnt worked, and it has resulted in Russia and China making common cause – a geopolitical disaster if ever there was one.
Washington Post :
“[Ukraine] was a sensible, cold-blooded strategy for the United States — attrition of an adversary at low cost to America, while Ukraine was paying the butcher’s bill.”
So now the EU countries are ratcheting up the warmongering rhetoric to a dangerous degree, which might be self-fulfilling. Kallas says she wants to “dismantle Russia”. LOL – with whose army I wonder? Rutte says “we must adopt a wartime mindset”. Is this the language of diplomacy? There is zero evidence that Putin has any intention of invading European countries – the idea is just preposterous.
“For the West, the demonisation of Vladimir Putin is not a policy; it is an alibi for the absence of one. […] But if Ukraine is to survive and thrive, it must not be either side’s outpost against the other — it should function as a bridge between them.” Henry Kissinger.
Good article by Thomas Fazi on this
https://unherd.com/2025/02/trumps-diplomacy-wont-bring-peace/
Yes, I agree with Fazi.
Thanks for the link to Fazis’s article Jeff, I agree with his views, Aurelien has a similar argument about our demonisation of and sabre rattling towards Putin. We need to rejoin the EU and try to be a stabilising influence within the bloc – and take a long hard dispassionate look at our so called special relationship with the US.
I have been thinking about this recently. With all the calls for bringing things like transport, water utilities, energy into public ownership, I wonder if this push for more defence spending might be the right time to demand the same of weapons manufacture.
Removing the profit motive means that there is more incentive for achieving peace rather than military might and continued conflict as an end of its own. Removing the profit motive also means that each £ or € spent will produce more bullets/tanks/helmets/whatever, which would make us safer, more affordably. Money would also be guaranteed to flow more around the economy rather than going to shareholders, which might make it easier to collect tax and thus spend more money on the things that really need it. And finally, because the companies and expertise would all be in public ownership, when (if?) things calm down, the government wanted to portion off some of the engineers or R&D to work on things like environmental protection infrastructure, all the groundwork and admin is already laid out and wouldn’t need any additional spending.
It also has not escaped my notice that for all of the US’s protestations that we should spend more of our own money on defence, a lot of defence companies we would need to contract to are actually American. Seems like it would be poetic justice if we used this as an opportunity to clean our hands of their influence altogether.
At the current rate of progress, Pugin will have died of old age before Russian forces reach the Polish border. We are endlessly told of Russian blunders,losses and reliance on Korean troops. So why the panic? Why the unnecessary smears against Corbyn? Currently Trump is leading the forces for world peace with his direct negotiations with Putin and the talk about Ukraine ceding Eastern territories to act as a buffer zone. And the suggestion that Putin would be happy to settle for such a buffer zone. Much more to discuss and clarify but exaggerating the Russian threat doesn’t help a peaceful resolution.
I suppose it’s a question of which threat (real or imagined) politicians find easiest to scare the population with, so their industrialist oligarch friends can be showered with public money. Apparently, Russia is scarier than Climate Breakdown. How sad.
In the early days of Putin following the decade of oligarch looting of Russia’s public assets – { during which many Russians were starving } , involving dark money from the West and to the benefit of City of London’s international money laundering and money-servicing model , Putin seemed to be regarded as a friend. Some see him even now as part of the global oligarch network –
There were jokey suggestions that Russia might join NATO – and it was in the G8.
But it was obvious this would never do – certainly not for the military-industrial complex – after all, we do need one or more forever enemies. The ‘axis of evil’ and all that.
‘Experts’ now pushing for rearmament including ex defence ministers, retired chiefs of the general staff etc etc – just assume Russia will always be the enemy.
But absolutely no push to build relations and sort out Russia /Belarus /Ukraine or Israel/ Palestine over last twenty years.
Just sat and watched and profited until the only option is war.
Andrew Broadbent – you have just spoken of the second front in a battle with Russia – the City of London, whose financial ops have enabled Putin and his lieutenants, not forgetting to mention what has been happening in New York as well, funny money connected to Trump.
All this needs stripping out – that would really hurt Putin but the City and its new York cousin – and who knows, Switzerland as well – have simply not co-operated.
As far as I am concerned, the City, New York and Switzerland (others?) have aided and abetted hostile nations to pose a threat to peaceful ones. Those I implicate need to be made to bow and made accountable because they have for sure taken their cut. And then they should go to prison.
Putin’s financial operation is deeply embedded in this country and a lot others. As I said, it needs to be dug out and stopped, especially when you consider the lives that are stake, including my own flesh and blood and no doubts the flesh and blood of others here too.
My old work on tax havens remains as relevant as ever.
My suspicion is that the strain on the Russian economy would create serious difficulties if the war lasted another six to twelve months. Ukraine cannot do it alone and won’t last long is support is withdrawn. But if the West continues to support Ukraine, Russia would break eventually, just as the Soviet Union did. (Or at the very least Putin would be “retired” and his successor would be able to reach a settlement.)
Putin has been holding out for Trump to give him a favourable deal. No doubt backs will be scratched. Perhaps Putin can help Trump with the US transition to his sort of “managed” democracy.
@Jeff Lucas “There is zero evidence that Putin has any intention of invading European countries – the idea is just preposterous”.
I disagree, actually. Putin has made many speeches in the Duma stating that Lenin, Stalin and Khruschchev were wrong to cede Russian territory to the Ukrainians. Putin has studied Russian history in depth, stretching at least as far back as the 10th century. His speech after the annexation of Crimea in 2014 was full of references to the reunification of Russia with its historical lands and people.
The Baltic States have large Russian-speaking minorities, a product of centuries of turmoil in Europe – but mostly a product of the Cold War and the Warsaw Pact. Putin was devastated by the collapse of the Soviet Union, not least because countries like Ukraine, the Baltic States and Poland were no longer buffer states between Russia and NATO.
So I think that, given half a chance, Putin would certainly push further into Europe; staring with the Baltic States and Finland – via Belarus. He desperately wants unfettered access to the Baltic for military and political purposes.
Thanks for that, Hannah.
Putin has made it quite clear he has no interest in recreating the Soviet Union. Ukraine is a special case for many geopolitical and historical reasons, and many top level western top diplomats and politicians warned prior to NATOs 2008 Bucharest declaration that if Ukraine joined NATO, the Russians would regard it, in the words of Angela Merkel, as a declaration of war. Do you think Trump would countenance Canada forming a military treaty with China? Would the UK accept an independent Scotland doing the same? The idea is laughable. Furthermore, at the time of the 2008 declaration by NATO that Ukraine would become a member, opinion polls showed that only 20 – 30 percent of Ukrainians wanted to join NATO. It certainly cannot be claimed that this was the will of the Ukrainian people at that time. Up to that time, Russia had been cooperating with the West and had made suggestions about constructing a new cooperative security arrangement between Russia, Europe and the USA – which we rejected. I belive we can secure peace and cooperation with Russia, based on a mutual recognition of each other’s security concerns.
Precisely Hannah. Putin has said enough times that he wants, effectively, the borders of the USSR back. The idea that he invaded Ukraine in self defence as some on the extremes of politics like to believe, is for the birds. Richard has called him a fascist, and if he isn’t that he’s an ethno nationalist.
Fortunately for Putin he now has a fascist leading the USA who, unsurprisingly, can’t wait to do a deal with his fellow fascist Putin, a deal which it seems will let Putin keep all the territorial gains achieved through his invasion and stop the sanctions and other methods used against Russia which have had some effect on Russia’s economy .
So if we are to stop Putin the rest of Europe needs to work together on economic sanctions and increasing our military strength.
If we don’t, Putin will know he can get away with unjustified acts of aggression, and just do it again.
Please could you give references to these “enough times” where Putin has said he “effectively” wants the borders of the Soviet Union back?
I’m in no way a hawk but have felt for decades that we need some kind of European defence force instead of NATO.
The ideology behind NATO was ostensibly combined-defence against the rise of communism (US companies did well too). But we’ve been living in a post-communist world for some 30 years now.
Why should we be held at knifepoint to the whims of a lunatic in the white house?
I also don’t believe Putin wants to invade Europe, he just wants his beloved USSR back.
Are we prepared to sacrifice a chunk of the Ukraine and perhaps the Baltic states? That’s the $64,000 question in my humble one.
It seems that the US government wants to negotiate directly with Russia to reach a Ukraine peace settlement, over the heads of Ukraine and the rest of Europe. This is exactly the sort of big power geopolitics that Putin wants, recognising Russia as a superpower on a par with the US, and each sides “allies” (minions) will quickly fall into line behind their leader.
Russia has a large army and lots of territory and nuclear weapons, but a small fraction of the economy and power projection that the US and China have today.
The US interest here seems to to stop spending treasure in Ukraine, and to that end they don’t really care how much Ukrainian territory they give away. They also have no interest in US troops guaranteeing the result. That is, they are expecting Ukraine and Europe to bear the cost of the “deal” the US is negotiating. The sort of frozen conflict that Putin seems to like to pin down his neighbours.
What if they disagree? And what if Putin tries something similar in other territories where there is a historical Russian claim and/or Russian speaking population? (Baltic states, even Finland or Poland)
This is not a deal, and there is absolutely no art to it.
@Jeff Lucas. I don’t think I suggested that Putin wants to recreate the Soviet Union, merely that he was devastated by its collapse. That is on record in many languages. As is Putin’s desire to gather all ethnic Russians together under the umbrella of Russia. I can provide any number of references for that. There are large populations of ethnic Russians in the Baltic States and, for example, Moldova. The indications are that unrest amongst these groups is stirred up by Russia. Elections in Eastern Europe are being re-run because of Russian interference.
Your examples of Canada and Scotland aren’t really comparable.
I do agree, however, that the West and NATO did themselves and Ukraine no favours by rejecting Putin’s early overtures and promoting membership of NATO for Ukraine. Those decisions were wrong and made for self-serving, geopolitical reasons. Eastward expansion of NATO has been a Russian fear since the 1960s; and until 1989, buffer states like Ukraine provided Russia with some security.
It is a terrible self-fulfilling prophecy. NATO vs the USSR and the Warsaw Pact morphed in the 1990s into mutual dislike and distrust; which in turn fuelled both the opportunistic extension of NATO and Putin’s paranoia.
I spent years watching the USSR from (West) Germany and Berlin, and actually cried with relief the night the Berlin Wall came down. I have no doubt that most ordinary Russians, Ukrainians, Poles, Hungarians and Lithuanians hoped for a life free of Western military threats. As did I. I have watched Russia with interest ever since, and noted Putin’s gradual assumption of absolute power after 2000.
What, I wonder, did NATO think when Russia massed its tanks on the border of Ukraine? Did anyone seriously believe Russia did not intend to invade? The time to intervene was 2014 (Crimea) or at the latest, early 2022. We did nothing on either occasion. And now here we are.
I cannot, I’m afraid, go along with your view that Putin has no designs on further chunks of Europe. I am no war monger. I’ve seen too much violence. But I am a realist when it comes to V Putin.
And now Starmer has said he will send British troops to protect Ukraine if a ceasefire goes into effect. Starmer is no strategist, and knows nothing of the potential consequences of this. The first British soldier killed, then what? Or the first Russian soldier?
Thanks Hannah, an excellent post. Of course the west should and could have done more to help Russia in the first few years after 1989.
But we didn’t, just as we did nothing when Putin annexed parts of Ukraine in 2014. So now , minus the USA, we (the European countries of NATO plus Ukraine) have to deal with the reality we are now in.
Your second to last paragraph is exactly how I feel.
And if some shitty ‘peace’ deal is negotiated we will need to put European troops on the ground in Ukraine as part of a peacekeeping/deterrent force facing the Russians.
It is a refreshing change to be able to discuss this issue with someone who is well informed and brings some personal experience to “bear” (pardon the pun) . As has often been said in relation to Gaza, history didnt start on Oct 7th 2023, and the same is true with Ukraine. Mention the Bucharest declaration and most people have no idea what this refers to. I have some common ground with you, but I guess we differ as to whether we think Russia’s views on its own security threats can just be disregarded. I certainly have no personal reasons to be Russian apologist – quite the opposite – as the Polish side of my family suffered at Russian hands in WW2. I will look again at Putin’s post-Crimea speech.
As for Starmers UK troops in Ukraine I am reading that the Mod are rather alarmed about this. This mornings Mail Online ( not something I normally pay attention to) is hinting there may soon be an internal Labour Party coup attempt to depose him. So wait and see.
Just one final point – if , as you say, there is unrest to be stirred up in the ethnic Russians in the Baltic States, how about those states heading this off by addressing their grievances? Then there would be no unrest to stir up.
Further to my reply earlier today – just found this article on the website of the impeccably respectable Quincy Institute in the USA.
https://quincyinst.org/research/right-sizing-the-russian-threat-to-europe/
A very thorough assessment of the Russian “threat “, dated July last year. It’s a comprehensive treatment , and includes much on the Baltic republics. In the light of the now likely withdrawal of the US from NATO, it should be noted that “In a conflict against all European NATO countries WITH NO US INVOLVEMENT, Russia would be outnumbered 2:1 in active-duty ground forces and at a much larger disadvantage in air and naval forces.”
Three more quotes :
“There is no evidence that Russian leadership seeks to revise the status of post-Soviet and post-Warsaw Pact states that are already in NATO, particularly the Baltics, Poland, and Romania. Moscow has consistently denied any plans to attack NATO territory, nor does it have any ostensible reason to do so. “Russia has no reason, no interest — no geopolitical interest, neither economic, political nor military — to fight with NATO countries,” Putin said in late 2023.” “Their statements about our alleged intention to attack Europe after Ukraine is sheer nonsense,” he claimed in early 2024.
“A variety of factors, including NATO air and naval dominance, the difficulty of conquering urban areas, NATO political commitments to its eastern border states, and Russian weaknesses revealed in the Ukraine conflict, mean that Russian aggression against even NATO’s weakest states would carry enormous risks and be unlikely to succeed.”
“…any objective sense, aggression against NATO states presents a highly unattractive prospect to Russia. Such aggression would be unlikely to lead to significant territorial gains or cause NATO to back down. Instead, it would likely trigger a potentially catastrophic air and naval conflict in which Russia would be severely outmatched and likely suffer major strategic losses. Indeed, such losses could threaten the survival not only of the Putin regime but also of Russia as a geopolitical entity. NATO has enormous deterrent power against Russia, even in Russia’s “best case scenario” of aggression against NATO’s weakest border states in the Baltics.”
Comments welcome.
Thanks, Jeff and everyone. An interesting discussion, if not very tax orientated!
Do we really want more warfare over existing borders and territories in Eastern Europe? My sister-in-law,of proud Polish descent, once surprised me with a comment of extreme hostility towards Ukranians as a nationality. Apparently they are cruel and selfish, a view based on events of the Second World War, passed on to her by older relatives as she,herself, was not even born until the 1950s.
But ,in fact, the borders of Poland/ Ukraine were only created post-1945. The Western Ukranian city of Lviv, was within living memory (just) the Eastern Polish city of Lvov. Crimea was a part of Russia until much more recently,only being transferred to Ukraine during the Soviet period for ease of administration. Borders are not fixed except,maybe,in our limited historical brains. They are subject to convenient amendment. Just look at how Palestine is being slowly erased from the map, massacre by massacre, since 1948. So why send troops to die to maintain current borders between Russia and Ukraine when borders can be altered to suit whatever military power is ,temporarily, in ascendancy. Within the lifetimes of many of today’s observers they may change yet again. How about a return to a Polish Lvov? How about parts of Belarus returning to Poland? Or Greenland becoming Red,White and Blue land as a Trumpist US Senator is advocating? Or Canada becoming part of the USA,willingly ,because all the Trumpist states will have seceded and become an impoverished Confederacy? Pointless speculation of course. But how many lives are we willing to lose in the futile process of changing borders but not changing political policies?
I think your time here may be up. That is seriously misguided nonsense that suggests we are all just the playthings of powerful people, which is a hypothesis I can’t accept.
New Flame’s post echoes the Offensive Realism school of thought in geopolitics , that has a respected and impeccable pedigree and whose most well known proponent is Prof John Mearsheimer. His seminal and most well known book is “The Tragedy of Great Power Politics” https://www.goodreads.com/book/show/18378022-the-tragedy-of-great-power-politics.
In essence , the theory is that the Great Powers of the world will do what they can to survive , and the rest of us suffer what we must. You may not agree with it, and he certainly has his critics, but I think it does explain the histories of both Ukraine and Israel.